1.  INTRODUCTION

  1.1  This evidence to the inquiry is submitted by Liverpool City Council, which is the fifth largest Metropolitan Authority in the UK, serving a population of approximately 468,000. The City has experienced considerable decline in the last few decades, and this has been accompanied and, believed by some to have been partially caused, by a poor history in the governance of the City Council, and low quality and high cost services. After the election of the Liberal Democrat administration in 1998, a series of changes were initiated which have subsequently fundamentally changed the governance of the City and the approach to service delivery. The new Liberal Democrat administration decided to bring into the City Council an external review team under the auspices of the Improvement and Development Agency (IDeA). The team, which visited the City in March 1999, produced a report which was damning in relation to the way in which the City Council was being run. The report's main conclusions can be summarised as follows:

—  Weak and on occasions non-existent corporate management of key strategic issues.

—  Chronic departmentalism.

—  Hostility and mutual distrust between councillors and senior officers.

—  An excessive number of member-level committees, sub-committees, task groups and working parties which detracts from the effective participation of members in strategic decision-making and community representation.

—  Poor communications, especially with the workforce.

—  High cost. Poor quality services.

—  Disengagement by the council from the real interests of local people.

  1.2  Liverpool City Council was one of the first councils and the largest unitary council to introduce new political management arrangements, at the earliest possible date of May 1999. At this point the Liberal Democrat Group had been in control of the council for just one year, following many years of Labour majority and minority control. The ruling party's majority increased in May 1999 elections and now stands at 70 (Labour 20 Other parties nine).

  1.3  The previous arrangements were enormously bureaucratic, with a myriad of meetings and multiple levels of decision-making. In addition, the chronic departmentalism founded upon chair/chief officer empires, was another cause of overwhelming inertia. The new political leadership moved to make fundamental changes to the political management arrangements at the first opportunity, aiming to dissipate the old culture. Another strong motivator for change was the desire to signal a move away from old-style confrontational politics for which the city was known. In addition, levels of electoral turnout (in local and national elections) were, and continue to be, amongst the lowest in the country. There was an obvious need to take action to address this. Latterly at least, the old system could not be said to have engaged any but a small minority of the local population. Whether this was because of the system itself or other factors, there was no reason not to try a new approach.

2.  STRUCTURE

  2.1  The new arrangements established (open to press and public) a single party Executive Board with 11 members. After many years of bitter struggle between the main parties, power sharing so soon after assuming control would have been difficult. Similarly, a further transitional element was that whilst the size of the Executive is larger than the limit now imposed by the 2000 Act, it was important to be inclusive. Each executive portfolio covers a service grouping. These seek to encourage a cross cutting approach which was in 1999, new to Liverpool City Council eg Lifelong Learning, Supported Living. The standard responsibilities of Executive Members emphasise their strategic role, their responsibility for making cross-cutting links within and outside the council, and for ensuring that resources are allocated appropriately and deployed effectively.

  2.2  Members appointed a new Chief Executive in June 1999 whose brief included the need to design new officer management arrangements, which dismantled the departmental silos and reflected and meshed with the political management arrangements. The senior officer structure now comprises, in addition to the chief executive, five executive directors. Executive directors have responsibility for a portfolio of functions and services and their roles are, similarly, strategically focused on crosscutting. This replaces a previous management team of 11. Decisions are effected by Executive Member recommendations.

  2.3  A Select Committee (Scrutiny Committee) mirrors each Executive Portfolio. There are 12 Select Committees and each has 10 members proportionally balanced, and one, Performance Review, chaired by the Leader of the Labour Opposition. The responsibilities of the Select Committees are broad, including policy development and monitoring and review. There are also call-in arrangements on executive member recommendations whereby the Select Committees can hold the Executive to account in respect of individual decisions prior to their formal ratification. There is also a call up to Council provision. A small, politically balanced Ratification Committee formally considers decisions of the Executive. It has full delegated powers to ratify all decisions of the Executive which have not been called in, without further reference to council.

  2.4  The Council has also established Area Committees, a Standards Committee, and has committees to undertake regulatory and licensing functions. The Area Committees are at the cornerstone of the governance. Liverpool, like many other authorities, had a highly centralised decision making structure, and indeed service provision. The major focus of Liberal Democrat policies, sought to being effected by the administration, relates to the widest possible delegation of decision making, to areas and indeed neighbourhood levels Eleven Area Committees have been established, and whilst there has been something of a slow start, arrangements are now in place whereby these Area Committees are earning enhanced powers as a result of more effective functioning, and are already beginning to debate Council and other services to help prioritise services using local knowledge of Councillors and Advisory Committee Members, who have been appointed following local advertisements. This de-centralisation of governance is a critical issue in the rebuilding of the City Council. There are currently pilot projects in respect of neighbourhoods, which have at core the proposition that it is at neighbourhood level that residents most wish to be involved, both to advise on the services, and ultimately to become more involved through, for example, the provision of social businesses. Again, there is a long way to go in these areas, particularly as it is essential to achieve a quality of service and appropriate in cost our mainstream service delivery, so it is amongst the leading local authorities before full decentralisation can be secured with confidence.

  2.5  The new governance arrangements are aligned with the spirit of the legislation, under the Local Government Act 2000, by focusing Executive Member and Cabinet efforts at the strategic and cost-cutting level, particularly with the intention of moving away from an obsession with the provided dominated culture that exists in many local authorities, to one which seeks to embrace the tackling of the wicked issues of today—community safety, sustainability, environment and the rest through a myriad of partnerships with private public voluntary and not for profit sectors.

3.  TRANSITION TO A STATUTORILY BASED STRUCTURE

  3.1  A special council meeting was held on 11 January 2001 to initiate the transition. The Council agreed to prepare and implement, in accordance with statutory requirements, a consultation process on the three prescribed models for executive arrangements. The intention will be to:

—  As fully as possible engage all members of the community in the debate on future governance.

—  Provide information to every home in the City on the alternative options.

—  Provide information packs on the alternatives to stimulate debate in schools, colleges, community groups, residents groups and other appropriate venues.

—  Involve members of the Council in the information giving and consultation process.

  3.2  The Council has also asked for a revisit of the Improvement Team from the IDeA in June 2001 to specifically review and report publicly on the changes in governance already introduced and improvements in service delivery. Further, the council has established a cross-party review group to consider:

—  The development of the Council's current democratic process.

—  The performance of Area Committees and their development.

—  The review of the Select Committee (scrutiny) process.

4.  THE ELECTED MAYOR MODEL

  4.1  There has been considerable debate already about whether the governance arrangements in Liverpool should feature an elected mayor. This was initiated by the Liverpool Democracy Commission established independently of the City Council in 1999 but supported by the Leader of the Council (Councillor Mike Storey) and by the Leaders of the Labour opposition group (Councillor Frank Prendergast, former, and current Councillor Gideon Ben-Tovim). All these individuals submitted evidence to the Commission.

  4.2  In its report, the Democracy Commission strongly advocated the mayoral model. The view of the Liberal Democratic administration on the council is that the current arrangements with a Leader and Cabinet are working well and are growing in their effectiveness as members become more familiar with their new roles and the public become more used to the arrangements. The election of a mayor would be a distraction from the very necessary work the council is currently under-taking to improve its performance as a corporate organisation and of its individual functions and services. There is also concern about funding being provided by organisations external to the city with the object of stimulating a referendum. The future governance of Liverpool is a matter for local people to decide.

5.  THE OPERATION OF THE NEW STRUCTURE

  5.1  General preparation for the implementation of the new structure included the development of role specifications for all the future individual roles ie Leader, Executive Member, Select Committee Member, Area Committee Member, Community Councillor. There were also seminars and training days for all members and briefings for officers in the Council.

5.2  The Executive Arrangements

  Executive arrangements are working well at both an individual and collective level. There are excellent working relationships between the Executive Board (Members) and the Executive Management team (Officers). Substantial investment has been made to achieve this through joint development away-days and regular strategic policy discussions. An effective local authority depends upon the existence of a strong and effective partnership between senior officers and leading elected members. This does not happen by chance, it has to be worked at.

  The Executive Board meets once a fortnight in public. On the intervening weeks it meets with the Executive Management Team to receive briefings on different aspects of policy and its work programme. It is essential that there is an opportunity for Executive Members collectively, to receive and discuss the implications of officer briefings in private. The more prescriptive the arrangements for meetings of any executive (ie not only in Liverpool) become, the more likely this is to produce the negative effect of driving political discussions underground, distanced from a source of independent, professional advice.

5.3  Area Committees

  There are 11 Area Committees based on ward boundaries. These committees meet on a five weekly cycle. They are an important symbol of the council's commitment to local decision-making. The core role of Area Committees is to ensure the effective use of scarce resources by encouraging local needs to be identified and services delivered in accordance with local priorities.

  The membership of the committees is comprised of the local ward members and independent advisory representatives. The latter are volunteers whose role is to ensure that local people and communities have more say about local issues through the Area Committees. The independent roles were widely advertised, job descriptions and person specifications were prepared and applicants were selected through an open recruitment process that involved completion of an application form and an interview by a panel of two councillors and an officer. Advisory members are not paid for their time but are reimbursed expenses eg for travel to meetings. Between May 1999 and January 2001, the total public attendance at Area Committees has been 3,510 spread over 154 separate meetings. The main issues considered at meetings have been environmental, anti-social behaviour, planning and housing.

  Last autumn there was an internal review of the operation of Area Committees. This led to a number of developments including discussion and clarification of their role through a number of special seminars for all council members. Officer support for the Area Committees was increased. There is a group of designated officers to support each committee who undertake this role in addition to their core roles. There are now also regular meetings for the Chairs of Area Committees to develop consistency and good practice in the way the committees operate and deal with issues. An event was also held recently for the Independent Advisory Representatives with the objectives of acknowledging their contribution, gathering feedback on their experiences and clarifying any concerns they have about their role.

5.4  Overview and Scrutiny

  As in many councils that have introduced an Executive and Scrutiny structure, the development of effective overview and scrutiny arrangements is producing the most difficulty. There were two main reasons for this. First, when the new structure came into effect, it was essential that the Executive operated effectively from the outset so that there was no hiatus in the conduct of essential council business. Inevitably this meant the focus of attention and support was on the Executive arrangements. Second, the scrutiny role is significantly different from the roles most councillors have played previously. Consequently, it takes longer to understand the new role and how it must be performed and also and most important, how power can be exercised indirectly rather than directly.

  In Liverpool there is, possibly, an additional factor. The new ruling group is determined to see change. It has set itself very bold aims that will involve the transformation of Liverpool into a world-class city (from sea-port to e-port) and the transformation of the council into one that is highly performing. Given recent history and current levels of performance the achievement of these aims will require radical and speedy change. The operation of scrutiny can be seen by some as a means of slowing the pace of change and holding up radical proposals simply because the need for them is not comprehended by everyone and the details and the implications are not fully understood.

  The role of the Select Committees was identified from the point of introducing the new arrangements in broad terms including policy advice to the executive and the Council as well as calling the executive to account in respect of the conduct of current business. To enable the latter responsibilities to be undertaken, a call-in procedure was established whereby Select Committee members are able to hold up the ratification of decisions pending further discussion.

  The council has recently commissioned a review of its scrutiny arrangements by an external consultant because it is clear that the effectiveness of the Select Committees is patchy and some members are becoming dissatisfied. The review has been deliberately designed to give members the opportunity to speak directly and in confidence to the consultant about their experience. The review has concluded that there are high aspirations for scrutiny but there is a lack of clarity about how it should be undertaken. There has, perhaps, been too much emphasis on "calling-in" executive decisions but this is probably because there is more clarity about how to do this than how to perform other aspects of scrutiny. And although a significant number of decisions have been "called-in", in hardly any cases has this led, after further discussion, to the decision being over-turned.

  The council is now embarking on a programme of further activities to develop the operation of scrutiny arrangements including:

—  Clarifying the aims of Select Committees and gaining agreement to them for all council members whether they are executive or select committee members.

—  Establishing a programme of further training for Select Committee members, including special training for the Chairs.

—  Introducing arrangements for regular meetings of Chairs to co-ordinate the work of the 12 Select Committees.

—  Developing best practice guidance for operating Select Committees including a protocol for hearing evidence and asking questions.

—  Holding discussions between the political parties in order to establish an environment in which party politics are acknowledged to exist but are not allowed to interfere with an objective approach to scrutiny, if at all possible.

—  Establishing appropriate officer support for the Select Committees. This is likely to be linked with the council's best value arrangements and a very senior officer, reporting directly to the chief executive, will be responsible for resourcing (by providing effective officer support) select committee reviews and investigations.

  In addition to the development of the scrutiny function, there is also a major issue in relation to the role of councillors outside the Executive Member Chair of Committees responsibilities. One of the unintended consequences of the new system in halting committees, meetings, and the rest has been the distancing of Members at both an informal and formal level from what was widely to be perceived as the decision making forums. But in addition to the former role of Committees there was the sense of inclusion in the agenda and the opportunity to form a network between other Members of the same party, of other parties, and perhaps equally importantly, officers thereby enabling a growing dialogue to be sustained on issues of major constituency and ward matters. The Chief Executive of the City Council has reflected that his main engagement with Members now, apart from those in Executive Member Scrutiny responsibilities, has been at the Council meeting and during ward walkabouts. There is no longer the opportunity to meet and just network with Councillors in the margins of Committee meetings and the rest of the formal governance arrangements that previously existed. This has led to the term "backbench Councillor" becoming felt to be something of a pejorative phrase, and the Leader of the Council, together with senior colleagues has been very clear in re-designating colleagues with these sorts of responsibilities, as frontbench Councillors who will be far better supported with the development of Area Committees, One Stop Shops throughout the City and casework by officers. This remains a huge dilemma and particularly so given the 99 Members of the City Council and the level and scale of their relative involvements.

5.5  The Council Meeting

  The formal Council meeting on a six-weekly cycle remains a major dilemma. One level, which is recognised particularly by the political leaderships is that there has to be a "set piece" event in a City like Liverpool where there is a public debate of the big issues, and indeed the small issues of the moment and times, when in theory anyway the press and media, the public, and other interested groups, have the opportunity to see democracy in action. Some changes have been made to the formal agenda of the meeting by including a question time by Executive Members, and there have been other developments alongside such as the introduction of public question time outside the formal meetings of the City Council, and indeed a growing accessibility of officers through the question time process extending to schools, voluntary bodies, and the rest. But the challenge of getting widespread and fully representative involvement with the public in the Council meetings remains a major challenge.

5.6  The Role and Development of Members

  In the past, the role of Members in Liverpool has been focused on operational issues rather than at a strategic level. Members have sought involvement at a detailed level. The lack of trust between members and officers is both a symptom and a cause of this.

  The new arrangements encourage all members to step back from that level of operational detail. But this is seen by some as a loss of power. They see all power now lying with the Executive Members and have yet to come to terms with and fully comprehend a role which enables them to have influence through overview and scrutiny at a distance from the point at which decisions are taken. This has led to disengagement by some with council work. Whilst they remain active in their wards, their attendance at meetings of Select Committees, Regulatory committees, training sessions, special meetings, etc. is sometimes not reliable. A Member Development Working Party convened to look at all aspects of member development, is currently discussing ways to incentivise attendance and generate positive engagement by all members in the affairs of the council. This will include extending the programme of training and development for members based on a training needs analysis along with the possibility of finding ways to make some elements of the training compulsory.

5.7  The Role and Development of Officers

  The role of officers has changed at least to the same extent as the members' roles. For those in senior positions, they have had to come to terms with the ability of individual members to take decisions. It is essential for officers to find ways to provide regular, in-depth briefings and to ensure there are regular discussions at a strategic policy level. Developing a close but healthily independent and professional relationship of trust between leading members and senior officers becomes even more essential than before. The Chief Executive and the Leader have key responsibilities in setting both the tone and style for this and also ensuring that all executive members and all senior managers play their part.

  The change for officers in respect of the overview and scrutiny role is only latterly beginning to be fully recognised. It is clear that there is a need for specific officer support for scrutiny but this is not to imply that a separate officer structure needs to be developed. The key role is one of ensuring that scrutiny reviews are conducted and supported by an appropriate level of effective officer resource which is assembled at the point at which the need for it is identified in a Select Committee's work programme.

  Officers need to relate to members in a very different way in an overview and scrutiny context. They are there to support the members' inquiries and not to give them recommendations about how they should think and act. Joint training, including role-play, is being organised to help both members and officers to understand these differences.

5.8  Adequacy of Guidance from Government

  Whilst it has been valuable to have guidance in draft, the significant changes between drafts and final guidance have inevitably led to confusion. This says more about the lack of thought at the outset about how all of the proposals are meant to work in practice than the guidance itself.

  In general, however, it is not possible to prescribe the process for achieving effective governance. The outcomes can be prescribed but the means have to be worked out locally according to the specific situation and context.

6.  CONCLUSIONS

  Liverpool City Council has embraced the Modernising Agenda because of the particular congruence of change in political control, the widely accepted need for a step change in the quality of service, delivery and cost reduction, and most importantly a realisation that the governance of the City had become a very ineffective, inefficient and non-representative vehicle of exercising local democracy. That said there have been some major successes in relation to the quick embrace. There is no question that the new formal governance has enabled the newly appointment Chief Executive and Executive Team, with a very large degree of delegation, to quickly address major problems in service delivery. There is no question that if the previous arrangements has sustained, in terms of formal committees, the change agenda would have been very much slower, and indeed not achieved the critical mass which is now forcing the new Liverpool to emerge. So the new modernisation arrangements have been a major vehicle in enabling change. There have been issues in that process, some which have been rehearsed in this evidence. But it is important to consider the wider context, and particularly the inherently centralising tendency of government in the United Kingdom, which appears to have at times, the overriding objectives of centralising power and decentralising blame. Without an accompanying devolution in power and responsibilities to local government, alongside the new modernised arrangements, it is unlikely that there will be the conditions within which local governance can thrive, particularly evidenced by scale and depth of involvement in local politics, either by the turn out in local elections or party political involvement. Governments, central and local, do not create a vibrate local governance, but they can create the conditions within which vibrant local governance can be achieved.

January 2001